(Photo by Samantha Hurley from Burst)

While real estate predictions don’t always come true, they can help. If you’re considering entering the market, you should know the different possibilities.

For the last 18 months, real estate has been on a unique rollercoaster and it doesn’t look likely to let up anytime soon!  If you’re looking to buy or sell a home, you’re probably eager to find some stability in the market, but it’s hard to know how long the current market trends will last, and what to expect as we enter the last months of 2021. 

An economic upturn was predicted before the Delta variant of the coronavirus hit the country with a new wave of instability. And as there is no way to predict how this will play out — or if COVID-19 restrictions will return —  agents and real estate market experts do have opinions on what the market could look like for the rest of the year and have made some real estate predictions.

Top Real Estate Predictions for the Rest of 2021

Pricing

Throughout the last year and a half, home prices generally have remained high, and they don’t appear to be dropping. Even with these elevated prices, the number of homes sold has generally been increasing, while the number of homes listed for sale isn’t keeping up the pace. 

Pending home sales, a leading indicator of the health of the housing market, fell ever-so-slightly in both June and July, while prices have remained high. Agents admit they are seeing some homebuyers choosing to wait to see if prices will lower, but there are still many new buyers entering the market. (That said, Fall is usually a slower time for home buying, with prices tending to drop.) If this waiting trend continues, and home sales continue to slow, sellers may finally be compelled to lower their prices, giving buyers more time and flexibility when purchasing homes.

There does appear to be a shift — not away from the Seller’s market — but at least toward some positivity for buyers. Median listing prices in several metro areas are leveling and new sellers are entering the market competitively, but with closer to “normal” property prices. Price rise in major metro areas like DC and New York appears to be slowing somewhat quicker than in the rest of the country. Still, the nationwide median listing price for active listings in July 2021 was $385,000, up over 10% percent from July 2020, which was also elevated.

Mortgage Rates

The pandemic saw mortgage rates reach record lows, and while some predicted that rates would increase with an economic upturn, they have actually been on the decline again in recent months. Of course, with the Delta variant and other unpredictabilities, it is impossible to know where the economy is headed, but the 30-year fixed-rate mortgage did drop from 3.02% in late June to 2.78% in late July. 

Experts still are optimistic about the economy and expect mortgage rates to rise, possibly up to 3.5%. This coupled with an increase in inventory may quiet the market slightly in the short term, or at least until Spring when home sales are typically quite strong.

Inventory 

The real estate surge isn’t stopping anytime soon and many real estate predictions agree, but inventory numbers are rising. As the number of newly listed properties increases, the decline in time-on-market has slowed, and agents are anticipating that the market may begin to return to previous seasonal patterns. 

Still, demand remains high and homes are being purchased and taken off the market quickly, so if you are in the market to buy a property, do not delay, and make sure to get your mortgage pre-approval ready and finances in order! 

Market Crash?

While it may seem (to buyers) like prices have risen to a breaking point, no market crash is anticipated in the next couple of years. As long as new buyers continue to enter the market and there aren’t enough homes for sale to meet demand, the market should stay strong, and will likely see both sales numbers and prices continuing to go up.

In summary, home sales and prices are likely to stay higher for the remainder of 2021, while inventory will remain relatively low. We remain in a seller’s market, though some price stabilization may begin to occur and there should be an increase in more affordable property options in most markets.

While obviously there is no way to predict what will happen to the market, or to any specific market factor, national and regional trends help to show that the market remains strong, and now is as good a time as any to sell — or buy — a property. 

Check with LIST WITH ELIZABETH® to learn more about regional trends and real estate predictions for the Springfield and Burke areas of Northern Virginia.